Through a letter of intent, the systems have agreed to form an entity to oversee five Alexian-owned hospitals and four Adventist-owned hospitals in the Chicago area, the Chicago Tribune reports.

The Chicago-area systems will maintain separate assets and balance sheets, but would create an operating arm to manage strategy, planning, contracts and other corporate administrative tasks, according to the Tribune.

The proposed joint operating company comes as federal health law fuels hospital consolidation in the Chicago area, the publication reports. Last year, Adventist agreed to join Alexian's Medicare accountable care organization, paving the way for the proposed new joint venture, officials told the Tribune.

Alexian President and CEO Mark Frey would be the new company's CEO and its executive vice president would be David Crane, president and CEO of Adventist Midwest.

Adventist Midwest is a unit of Orlando, Florida-based Adventist Health, which has 44 hospitals.

Ascension, led by CEO Tony Tersigni and the parent company of Ascension Health, had operating revenue of $17.1 billion in 2013. Ascension Health closed on its purchase of Alexian Brothers Health System in January 2012.